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Home > Digital Marketing Blog > Possible Impact of Coronavirus on Startup Businesses

Possible Impact of Coronavirus on Startup Businesses

Possible Impact of Coronavirus on Start-ups
April 13, 2020

Possible Impact of Coronavirus on Startup Businesses

Apr 13, 2020
Chiranjeevi Maddala

Chiranjeevi Maddala is an award winning digital marketing strategist with over 18 Years of experience in Digital Media and Marketing. He is the Founder and Chief Mentor at Digital Ready.


Coronavirus hit the world in the winter season this year. Since then, the Coronavirus is taking the world by storm and affecting people across the globe in every region. From China to the USA, Coronavirus is killing people with its outbreak, which is contagious in nature and highly communicable. Coronavirus has hit the world very hard in every aspect.

On 11th March 2020, Coronavirus was announced as a pandemic around the world by the World Health Organization. Most of the countries around the world are on lockdown due to the outbreak. People are forced to keep social distancing from each other, and everything is on a halt. Let us have a look at some facts related to Coronavirus.

Facts on Coronavirus

  • The outbreak started from Wuhan City of China in a wet market
  • Wuhan became the ghost town after the outbreak, and it spread across the globe like wildfire
  • Coronavirus is a zoonotic disease i.e.; it spreads from animals to human beings
  • Most of the powerful economies got hit by the virus, for example, China, India, the USA, the UK, France, and Italy
  • In China, more than 3000 people were killed by the virus, and thousands of others got affected
  • The outbreak has killed more than 10000 people in European Countries
  • India is under lockdown since the end of the march month to combat the spread of the virus.
  • Industries are getting poorly hit consequently
  • The economy is going under stress due to lockdowns everywhere

Impact of Coronavirus

The outbreak has left the world economy hanging by the hook as it is slumping down and down day by day. People are losing jobs. Daily workers are losing daily wages, and countries are going into a recession cycle for the coming months.

  • The USA recorded the highest number of unemployed workers in the month of April, which is around 6 million
  • The travel sector has been hit badly due to lockdown and quarantine scenarios across the world. More than a hundred countries have travel restrictions to prevent the spread of the virus
  • People started hoarding the grocery item in bulk due to the fear of pandemic and emergency situations, which led to the situation of chaos in some countries

The impact can not be covered in words if anyone starts to write about it. 

Impact of the Pandemic on Startups

In the middle of the pandemic, small businesses or start-ups are the worst to hit as most of the investors are on the verge of huge losses due to the breakdown of economies. 

  • Many of the start-ups are having problems with having enough cash flow from the investors
  • Start-up is also known as the gig-economy
  • It must be challenging to keep the work going on 
  • Start-ups are in the lower cash reserves due to these sudden downturns of the economies around the world
  • Start-ups are losing the workforce due to the cash crunch
  • Most of the start-ups are going to feel the ripple effects of this deadly pandemic

Everything is going to be changed in this dynamic word after this pandemic. Nothing will be the same. The economy, the business model, the investments, and the stock market all of them will be taking a whole new approach to come out of the heat of this catastrophic pandemic.
Let us take some cues from the article as to what these start-ups are going to do to keep up until the pandemic gets over. Start-ups owners are supposed to take this time as their buffer zone to make some strategies about the future of their start-ups.

What Start-ups are Supposed to Do in These Difficult Times

Think of a New Business Model

Since the world, we knew yesterday is never going to be the same because of all chaos and pandemic-turned-recession situations, especially the world economy. Start-ups owners need to work on their business model to make it profitable in the coming months and years. 

  • Just come out of the herd mentality and utilize the new situation, no matter how bad it is
  • As per darwin, this is the survival of the fittest and who will adopt the new environment will survive. The same things apply to the current situation
  • Just keep your fingers crossed and your statistics up to the mark in the section of revenue and expenditure to take on the new situation
  • Optimistic nature can help you here profoundly
  • If a situation comes, then do not hesitate to switch the business model. If you have to change the base model from B2B to B2C, always remember to act as per situations and circumstances
  • Keep your money at a stretch and save every single penny you
  • Keep your financial metrics up to date

Connect with Start-Up Community

For the start-up community, the time has come to cross the ribbon. For years, there have been many tech firms in Europe, Asia, and the Americas working as role model start-ups. Many countries in Europe started strong ties in difficult times like Estonia, and Portugal’s start-up community came closer and more reliable. These countries have made portals and platforms to help out the small start-ups in the time of need.

  • Strengthen the ties with other start-ups
  • Vertical and horizontal networking is the need of the hour
  • Time to convert connection into bonds
  • Try to involve as much as you can digitally to sail the storm

Use Tools for Automation

The world economy was working fine from the cubicles of the brick and mortar model of the firms, but the tables have been turned as everyone is locked in the home. The outbreak has taught us that there are a few firms that are capable of converting a working from a home entity. Most of the small and medium enterprises suffered blows because of lockdowns as they were not capable of giving work from home to every employee.

  • Start embracing the tools to reach your human resources
  • Bring the digital transformation in your business model
  • Learn new skills to get connected with the world
  • Try to embrace the use of artificial intelligence in your business model
  • Run marketing campaigns using artificial intelligence tools
  • Have the acquisition of required IT tools for your team

Use Tools for Digitization

After giving your employees work from home automation tools, there is a need for getting connected all the time to check on the work progress. Many small-medium enterprises use outdated technologies to reach their employees to cut their expenditures. Digital technology is there to help you out. The time has come to invest in some really good digitization tools to keep your business afloat.

Embrace the new working ecosystem as per the changed circumstances

  • Try to use Zoom call, Trello, or Slack to create your own working space via the internet.
  • You can have access to all employees even in the times of lockdowns without any interruptions.
  • You can have meetings and conference via video conferencing tools
  • You can solve the queries from the team, and some excellent ideas can be shared without any other expenditure 
  • Get comfortable in your newly modeled working space in the comfort of your home while sipping the 

Keep Up with the Investors

Investors are the keystone of any start-up. Investors are the first to flee in the time of distress as they also want to save their money and resources without burning up the money. Investors are bearing the brunt of the pandemic across the world, just like you.

What kind of Situations can you face?

  • Cash crunch due to investors fleeing the market
  • Many investors have seen only the booming face of the market, and they cannot be ready to face this type of situation
  • Venture capitalists can convert into vulture capitalists if they have to save their money
  • Investors can leave you in between of a recession without a thought

What should you do?

  • Have access to capital- the foremost thing to survive in the market
  • Keep your numbers up to date
  • Be smart to smell the fishy practices by the investor in distressing times
  • Do not follow the herd mentality 
  • Rationalize every single resource you have with you
  • Keep your books updated

Hire the Best Talent

Most of the firms are having lots of time in their hands to spare. Do not waste this precious time as you can rationalize many things in your start-up and give a new definition to your start-up. First and the most critical asset to a business is a competent workforce. Quarantine period has given you the time to hire some of the best minds you can search for your start-up who can take your start-up to new heights with their competence.

  • Search the Social Media Platforms
  • Get connections on the LinkedIn, Facebook an twitter
  • Convert contacts into some of your employees
  • Go through as many as profiles you can do in a day
  • Hunt down the best minds which are suitable for your start-up

Organize Webinars and Podcasts

Digital tools are always there for you to help in difficult times. For marketing or having investors or employees on board, you can rely on podcasts and webinars. You can update people around you through webinars using social media platforms. Just go live and stay aware and keep aware of others as well.

  • Organize podcasts about the products and growth of the company
  • Present some challenges by organizing hackathons
  • You can spread the awareness about Coronavirus and promote your idea to the masses
  • You can take sessions or presentations on specific topics you want to speak
  • Make a new connection channel
  • Try to mobilize the support of the start-up community via podcast or webinar
  • Organize Questions and Answers session

Work on Innovative Ideas

The sole purpose of the start-up revolution was to find innovative solutions to daily life problems or complex issues. Start-up culture has helped a lot in achieving the success in getting digitalization and artificial intelligence age.

Start-ups can do wonders in the time of distress and to fight the deadly COVID-19.

  • Funding Start-up are collecting funds to donate for the needy
  • Thousand of people getting help by innovative helping tools
  • Health care start-ups are doing a fantastic job amid the outbreak
  • Awareness campaigns are going on and on everywhere 
  • Zoomcar is delivering the essential commodities
  • Zomato is delivering products along with the social distancing policy

Conclusion

Coronavirus outbreak is going to prove a watershed moment in the history of humankind. Not a single industry is going to be unaffected from the implications, as its impact is enormous. Surviving in these times will be a big win for start-ups across the world as they are giving jobs to lakhs of people and supporting the economy in distressing times. The outbreak is testing the resilience of investors and start-up owners at the same time. But this time will pass, and we will stand together in this.

Stay Home | Stay Safe | Stay Aware

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